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PPCR promotes resident consultation and engagement amongst social tenants with the view of empowering residents. Learn more
In April 2012 we ended the Housing Revenue Account subsidy system. This means councils can now keep their rental income and use it to fund their housing stock (called ‘self-financing’).
The powers to introduce self-financing were in the Localism Act 2011. On 1 February 2012 we published the final details of self-financing. This included the one-off payments to or from each council, which we used to adjust their housing debt to reflect the value of their stock.
Councils whose existing housing debt was higher than the value of their stock had some debt paid off by the government. Councils whose debt was lower than the value of their stock borrowed to pay the difference to the government.
These payments were based on a valuation of each council’s stock, using a 30-year discounted cash flow model of income and expenditure. The costs in the model assumed that councils will need to spend on average 15% more on managing and maintaining their stock than was assumed under the subsidy system.
The objectives of this reform are: